I would say that what has happened is that everywhere consumers go they don’t feel like they are getting a deal. This whole inflationary episode feels like a bunch of nickel and diming after every episode. I am angry my Greek yogurt brand has increased one dollar a pint. I am angry that the Brazil coffee tariff prices negotiated a long while ago are passing through. I am angry my it takes ten extra dollars to fill my Corolla.
One reason why liberals don't really want to set aside their other priorities to lower inflation is that they feel aggrieved, and understandably so. There's a lot of rhetoric about how unjust it is that Republicans get to explode the deficit and then Dems are expected to come back into office and clean up their messes instead of addressing their own priorities and we shouldn't play that game anymore. But it's notable that this rhetoric stipulates that a large deficit (at least in certain economies, including our present one) is a mess, not some fake thing. On what other issue would a party complain that the other side made a mess and not fix it because that isn't fair? Isn't fixing your opponents' messes the whole point of politics? From a purely political perspective, isn't the fact that the other side made a mess a good thing and an opportunity? Especially in this case, where lowering the deficit is the most straightforward tool the government (outside the Fed) has for lowering inflation?
With Trump as the head, now is the best time to push through some austerity and inflation control. He could veto but he might sleep through everything. Trump will get the blame.
The simplest explanation is that the inflation stat just isn’t accurate and actual inflation is a bit higher. I would’ve said this was a conspiracy theory in the past because my own spending pre-COVID was relatively constant year to year. But this year I’ve saved much less money than last year and even less money this year than in 2024 when I bought a new car and haven’t made any similarly large purchases this year. And many of my expenses are fixed (I have a COVID-era mortgage and employer-subsidized daycare)—imagine the situation facing a non-homeowner who is literally facing double or triple the monthly costs of pre-COVID!
Paul Volcker showed that the war against inflation is fought with really high interest rates. Those are also unpopular, and might even cause an recession, like what happened in the early 80s. But, of course, everyone forgets that when interest dropped because inflation had been "beat," Reagan had the largest Electoral College victory ever.
Modest inflation doesn’t feel “modest” when all expenses increase at the same time. Gas is the straw that broke the camel’s back, but that same camel is also carrying higher utility costs, groceries, housing, healthcare and consumer goods. And, for most of the population who are not part of the top 20%, they feel this confluence in the rise of all costs sharply—it’s certainly not imaginary.
You mostly get to go to work and to the grocery store. Every time I fill up it feels awful. Is it economically devastating, no but 4 dollar gas feels like a kick in the shins.
I would say that what has happened is that everywhere consumers go they don’t feel like they are getting a deal. This whole inflationary episode feels like a bunch of nickel and diming after every episode. I am angry my Greek yogurt brand has increased one dollar a pint. I am angry that the Brazil coffee tariff prices negotiated a long while ago are passing through. I am angry my it takes ten extra dollars to fill my Corolla.
One reason why liberals don't really want to set aside their other priorities to lower inflation is that they feel aggrieved, and understandably so. There's a lot of rhetoric about how unjust it is that Republicans get to explode the deficit and then Dems are expected to come back into office and clean up their messes instead of addressing their own priorities and we shouldn't play that game anymore. But it's notable that this rhetoric stipulates that a large deficit (at least in certain economies, including our present one) is a mess, not some fake thing. On what other issue would a party complain that the other side made a mess and not fix it because that isn't fair? Isn't fixing your opponents' messes the whole point of politics? From a purely political perspective, isn't the fact that the other side made a mess a good thing and an opportunity? Especially in this case, where lowering the deficit is the most straightforward tool the government (outside the Fed) has for lowering inflation?
With Trump as the head, now is the best time to push through some austerity and inflation control. He could veto but he might sleep through everything. Trump will get the blame.
This article has very big “What can a banana cost?” energy. Rich urban guy wonders why the suburban middle class thinks prices are high
The simplest explanation is that the inflation stat just isn’t accurate and actual inflation is a bit higher. I would’ve said this was a conspiracy theory in the past because my own spending pre-COVID was relatively constant year to year. But this year I’ve saved much less money than last year and even less money this year than in 2024 when I bought a new car and haven’t made any similarly large purchases this year. And many of my expenses are fixed (I have a COVID-era mortgage and employer-subsidized daycare)—imagine the situation facing a non-homeowner who is literally facing double or triple the monthly costs of pre-COVID!
The unemployment stat also hides a huge amount of variation by age. Young people have it pretty bad. Young college grads are back to early-2010s levels of unemployment: https://www.epi.org/blog/class-of-2026-young-college-graduates-face-a-weaker-labor-market-but-a-more-mixed-picture-than-the-headlines-suggest/. And everything is much more expensive than the early 2010s.
Paul Volcker showed that the war against inflation is fought with really high interest rates. Those are also unpopular, and might even cause an recession, like what happened in the early 80s. But, of course, everyone forgets that when interest dropped because inflation had been "beat," Reagan had the largest Electoral College victory ever.
If you need to borrow money to buy a house like most people, interest rates *are* inflation.
Modest inflation doesn’t feel “modest” when all expenses increase at the same time. Gas is the straw that broke the camel’s back, but that same camel is also carrying higher utility costs, groceries, housing, healthcare and consumer goods. And, for most of the population who are not part of the top 20%, they feel this confluence in the rise of all costs sharply—it’s certainly not imaginary.
The other thing about the price of gasoline is that you get a hell of a lot of utility from a gallon of it, and even $5 seems wildly underpriced.
You mostly get to go to work and to the grocery store. Every time I fill up it feels awful. Is it economically devastating, no but 4 dollar gas feels like a kick in the shins.
Car dependent infrastructure strikes again.